Phone Industry Bill Backed by New Coalition

By Merrill BrownBy Merrill BrownJune 24, 1980

Decrying what they called an environment of "regulated competition," a group of businesses and labor unions formed a coalition yesterday to back quick passage of legislation they say will reform the nation's communications laws and bring the telephone industry into the marketplace and out of the courtroom.

The group includes firms such as United Telecommunications Inc., the country's third-largest telephones system; other telephone companies; the Communications Workers of America and the National Cable Television Association.

At the same time, however, a separate group of union and lobbying groups announced opposition to sections of legislation before a Senate committee that would deregulate segments of the broadcasting industry.

Although members of the group backing charges in telephone industry regulation say they differ on precise legislative language, they say they agree on the need for prompt action on regulatory reform legislation.

If telecommunications legislation is not enacted in this Congress, efforts by the Federal Communications Commission to deregulate facets of the industry could remain tied up in federal courts for up to five years, one official of the group said.

Winston Himsworth, a vice president of Salomon Brothers, the New York investment house, predicted that the communications industry faces major problems raising capital if legislation is not signed into law soon.

"Without the element of certainty in the regulatory and financial communities, the telecommunications industry simply cannot provide the American public the full benefits of new communications techology," said Paul Henson, chairman of United Telecommunications.

At the same time, a Senate Commerce Committee session to consider a telecommunications package today was postponed in light of health problems of two key sponsors of the bill, Sen. Barry Goldwater (R-Ariz.) and Harrison Schmidt (R-N.M.). The session was not rescheduled, although if Goldwater and Schmidt are available Thursday the markup of the bill will be held then, a committee staff member said.

Nevertheless, opposition to the Senate bill appeared to intensify yesterday, as several groups focused on the sections of the legislation that would deregulate segments of the broadcasting industry.

A bill which the House Communications subcommittee passed easily last week is awaiting consideration next month by the House Commerce Committee, but that Legislation only deals with common carrier issues, such as changes in telephones regulation and a revamping of American Telephone & Telegraph Co.

A group of labor unions, including the United Auto Workers and two public employe union associations; the National Education Association; the National League of Cities; and religious and broadcasting groups denounced the Senate legislation.

Absent from the coalition that yesterday announced support for telecommunications legislation were two key industry players, International Business Machines Corp. and AT&T., A coalition spokesman said two companies were invited to join.

But an IBM spokesman said yesterday the company supports the House legislation. The House bill "provides a framework for advancement of technological invovation in the competitive marketplace while preserving affordable basic telephone service," IBM said in a statement.